Debt Collection Company Agrees to $9 Million Settlement Over Illegal Phone-Calling Practices

Debt Collection Company Agrees to $9 Million Settlement Over Illegal Phone-Calling Practices

A giant debt collection company will pay $9 million to settle a lawsuit filed by Santa Clara County District Attorney Jeff Rosen and 17 other county prosecutors aimed at silencing thousands of harassing, unwarranted and illegal phone calls.

The settlement, one of the largest of its kind, resolves the civil complaint that alleged that employees of iQor Holdings Inc. and Allied Interstate LLC subjected numerous people to badgering calls for months on end, even when no money was owed. One San Jose man, for example, received 126 calls in less than a month. He owed no money.

“It’s not just irritating to get bombarded with these harassing calls, it’s illegal,” District Attorney Rosen said. “We will vigilantly protect the consumer rights of Santa Clara County residents.”

Allied and its affiliates are required to comply with state and federal laws regarding debt collection phone calls. Additionally, the judgment orders the company to immediately stop:

Making calls at an unreasonable frequency that could constitute harassment;

Calling phone numbers that the call recipients have identified as wrong numbers;

Calling numbers when the recipients request to stop getting calls; and

Using robo-dialing technology to call consumers’ cell phones without the consumers’ consent.

Allied and iQor also must provide training about the calling rules for employees who make debt collection calls, maintain records of calls and complaints, and conduct an annual third-party audit to ensure compliance with the settlement provisions for five years.

The lawsuit alleged that Allied and iQor engaged in illegal debt collection practices that violated California’s Rosenthal Fair Debt Collection Practices Act, the federal Debt Collection Practices Act and the federal Telephone Consumer Protection Act. The alleged violations included calling consumers with excessive frequency, sometimes hundreds of times and sometimes calling the wrong person numerous times; failing to cease calling even when advised that they had reached a wrong number; and using a robo-dialer, known as a “predictive dialer,” to place calls to the cell phones of consumers without having adequate proof that the consumer had consented to be called on their cell phone.

This was the 11th law enforcement action filed against this debt collector over a decade.